This story first appeared Aug. 19, 2010

Imprisoned oil and gas swindler David Rose agreed to pay $15.4 million settlement.

The settlement also bars Rose, who is in the federal prison medical facility in Lexington, from selling unregistered securities in the future.avid G. Rose has entered a $15.4 million deal with the U.S. Securities and Exchange Commission to settle allegations that he and two family members defrauded more than 265 investors in unregulated securities in multiple states.

The settlements, filed last week in U.S. District Court for the Southern District of Indiana, stem from a suit filed last year against Rose, his sons Jason and Brian Rose, and nine other businesses and individuals.

The suit accused the Roses and other defendants of defrauding customers through a company called Berkshire Resources LLC. In the settlement, Jason Rose agreed to surrender $182,896 and to pay a civil penalty of $130,000. Brian Rose will pay $441,658.

The settlements say that no promises have been made to the Roses on any possible criminal charges.

The suit alleged that Berkshire raised $15.5 million from the investors throughout the United States and Canada in 2006 and 2007, but spent $6.7million of it on items having nothing to do with drilling. That includes $1.3 million to pay for mortgages on the Roses' homes, home furnishings, electronics, cars and credit-card charges.

MORE: Swindler's son accused of $15 million Ponzi scheme

The SEC's lead counsel, C. Ian Anderson, could not be contacted by phone about whether Berkshire or the Roses can pay the amounts as promised.

The defendants' former law firm, Frost Brown Todd, no longer represent them.

David Rose is serving a serving a 52-month sentence for tax evasion and defrauding dozens of investors in a separate scheme. He also was ordered to pay $2,964,371 to 62 victims.

Rose pleaded guilty in Louisville to federal criminal charges of fraud for misleading investors by falsely claiming his company had ties to major oil companies, and to spending on himself and others money that investors thought would go for drilling.

The former car salesman, who lived in a $1.7million house in Anchorage, also admitted evading taxes by transferring antique cars and other assets to acquaintances.

In a series of stories in 2006, The Courier-Journal described how Rose and his company, Robo Enterprises, misrepresented the risks of its investments, overstated its drilling successes and failed to disclose questionable uses of investors' money.

Several thousand investors — from Tahiti to Tacoma and from Belize to Boston — handed over a combined $100 million or more to Robo, and they lost at least 95 percent before any tax write-offs, the newspaper reported.

The government said Rose had purchased properties in the names of shell companies to evade taxes of more than $200,000 on income of more than $3.5million in 2000 and 2001.

Prosecutors also said David Rose allowed sales people to read scripts to investors that falsely claimed his company, enTerra Energy LLC, had joint-venture and partnership agreements with major oil companies like Citgo Petroleum Co., Hunt Oil and Texaco, in developing oil and gas wells.

No such joint venture or partnership agreements existed, the government said.